Slide 1: 4Q 2020 Earnings Presentation
4Q 2020 Earnings Presentation February 19, 2021
Slide 2: Forward Looking Statements
Forward Looking Statements This presentation contains certain statements that may be deemed “forward-looking statements” within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. All statements, other than statements of historical fact, that address activities, events or
Slide 3: Overview
Overview Strong Volume Growth, Margin Improvement and Cash Flow Generation • Delivered Strong 4Q20 Results to Finish 2020 Year-over-Year Variances – Expanded margins and generated higher earnings and cash flow while navigating the challenging macro environment 4Q20 FY20 – Positive sales volume growt
Slide 4: 4Q 2020 Financial Summary
4Q 2020 Financial Summary Strong Finish to 2020 ($ Millions, Except Per Share Amounts) 4Q 2019 4Q 2020 Comments • Sales Up 4.2%: Volume +7.9%, Price (3.7%) Sales $326.7 $340.3 – Market Pricing +0.7%, Raw Material Pass Through (4.4%) • Higher Market Pricing, Productivity and Volume EBITDA $12.7 $48.5
Slide 5: 4Q 2020 EBITDA Bridge
4Q 2020 EBITDA Bridge Disciplined Cost Management, Favorable Price/Raws Spread, Timing of Planned Plant Turnarounds ($M) $5 $4 • Plant productivity and volume more than offset increase in SG&A and other items • Chemical Intermediates • Ammonium $23 Sulfate $48 • CPL/Nylon $3 • (~$2M) in 4Q20 vs. (~$
Slide 6: Full Year 2020 Financial Summary
Full Year 2020 Financial Summary Robust Performance in Challenging Macro Environment ($ Millions, Except Per Share Amounts) FY 2019 FY 2020 Comments • Sales Down (10.8%): Volume +0.6%, Price (11.4%) Sales $1,297.4 $1,157.9 – Market Pricing (4.5%), Raw Material Pass Through (6.9%) • Favorable Impact
Slide 7: Cash Flow / Leverage
Cash Flow / Leverage Positive Free Cash Flow in 2020 as Expected; Robust Outlook for 2021 4Q20 Cash Flow ($M) Net Debt / Trailing 12-Month (TTM) Adjusted EBITDA Ratios Net Income $27 4 Net Debt / TTM Adjusted EBITDA Depreciation & Amortization $16 3 Target Range Customer Advances $22 2 2.9 3.1 Other
Slide 8: Industry Pricing And Spreads
Industry Pricing And Spreads Nylon Ammonium Sulfate Chemical Intermediates Industry Spreads Improving Off Trough Levels Monitoring AS Supply, Ag Fundamentals Improving Improved Supply and Demand Balance 4Q20 YOY 4Q20 vs. 3Q20 4Q20 YOY 4Q20 vs. 3Q20 4Q20 YOY 4Q20 vs. 3Q20 Global Composite (2%) 2% Ace
Slide 9: Industry Considerations Entering 2021
Industry Considerations Entering 2021 Diverse Product Portfolio Supporting Sustainable Earnings Nylon Ammonium Sulfate Chemical Intermediates • Improved carpet demand from residential • Expect increased ammonium sulfate • Expect favorable acetone industry applications; Expect commercial demand ferti
Slide 10: Sulfur Nutrition
Sulfur Nutrition Recent Activities Highlight Further Commitment to Growing in Sulfur Nutrition Value of Ammonium Sulfate (AS) on Soybeans • Today’s modern soybean varieties require better management of essential nutrients, like nitrogen and sulfur • AS proven to deliver pound-for-pound the most read
Slide 11: Sustainability
Sustainability Continued Commitment to Environmental, Social and Economic Sustainability Highlights • EcoVadis 2020 Gold Rating – Awarded a Gold Rating for corporate social responsibility (CSR) by EcoVadis, an independent CSR assessment agency – Ranked in top 4% of chemical industry peers • Together
Slide 12: 2021 Priorities
2021 Priorities Executing Roadmap to Deliver Long-Term Shareholder Value Continued Operational Excellence and Improving Through-Cycle Profitability • Targeting record year of production output to support higher earnings and robust cash flow generation • Maintaining approximately half of the 2020 cos
Slide 13: Appendix
APPENDIX 13 4Q 2020 Earnings Presentation – February 19, 2021
Slide 14: Planned Plant Turnarounds
Planned Plant Turnarounds Pre-Tax Income Impact by Quarter (1) 1Q 2Q 3Q 4Q FY 2017 -- ~$10M ~$4M ~$20M ~$34M 2018 ~$2M ~$10M ~$30M -- ~$42M 2019 -- ~$5M ~$5M ~$25M ~$35M 2020 ~$2M ~$7M ~$20M ~$2M ~$31M 2021E -- $11-$13M -- $14-$17M $25-$30M • Timing driven by compliance, inspection and sustaining as
Slide 15: Reconciliation of Non-GAAP Measures to GAAP Measures
APPENDIX Reconciliation of Non-GAAP Measures to GAAP Measures 15 4Q 2020 Earnings Presentation – February 19, 2021
Slide 16: Reconciliation Of Net Cash Provided By Operating Activities To Free Cash Flow
Reconciliation Of Net Cash Provided By Operating Activities To Free Cash Flow (in $ thousands) (1) Free cash flow is a non-GAAP measure defined as Net cash provided by operating activities less Expenditures for property, plant and equipment The Company believes that this metric is useful to investor
Slide 17: Reconciliation Of Net Income To EBITDA
Reconciliation Of Net Income To EBITDA (in $ thousands) (2) EBITDA is a non-GAAP measure defined as Net Income before Interest, Income Taxes, Depreciation and Amortization (3) Prior year one-time Pottsville restructuring charges reflect the closure of the Company’s Pottsville, Pennsylvania films pla
Slide 18: Reconciliation Of Net Income To Adjusted EBITDA
Reconciliation Of Net Income To Adjusted EBITDA (in $ thousands) (5) EBITDA is a non-GAAP measure defined as Net Income before Interest, Income Taxes, Depreciation and Amortization (6) Adjusted EBITDA is defined as EBITDA plus Non-cash stock based compensation, non-recurring, unusual or extraordinar
Slide 19: Reconciliation Of Net Debt And Net Debt To TTM Adjusted EBITDA
Reconciliation Of Net Debt And Calculation Of Net Debt To Trailing 12-Months (TTM) Adjusted EBITDA Ratio (in $ thousands) The leverage ratio of Net debt to TTM Adjusted EBITDA is a financial measure that the Company believes is useful to investors and financial analysts in evaluating the Company’s l